Core Viewpoint - UBS has lowered the target price for China Unicom (00762) from HKD 11.6 to HKD 11 while maintaining a "Buy" rating, reflecting adjustments in profit forecasts due to macroeconomic headwinds affecting business growth [1] Financial Performance - For Q3 2025, China Unicom reported service revenue of RMB 83.3 billion, a year-on-year increase of 0.2% [1] - EBITDA for the same period was RMB 25.4 billion, showing a year-on-year growth of 0.1% [1] - Both service revenue and EBITDA figures were below market consensus by 1-2%, but in line with industry peers [1] - Net profit increased by 5.3% year-on-year, consistent with the 5% growth rate observed in the first half of 2025 [1] Depreciation Policy Change - Starting from October 1, 2024, China Unicom will extend the depreciation period for its 4G assets from 7 years to 10 years, benefiting from depreciation savings [1] - This change is expected to contribute to profit growth in Q3 2025, allowing China Unicom to outperform its peers [1]

Core Points - The iPhone Air has officially launched in mainland China, marking the first phone in the region to support eSIM technology [1] - The eSIM service is currently supported by major carriers in mainland China, including China Unicom, China Telecom, and China Mobile, while China Broadcasting Network does not support it [3][4] - The eSIM business is still in its early stages in mainland China, with ongoing improvements in processes and policies [19] Carrier Support - China Unicom, China Telecom, and China Mobile support eSIM services for the iPhone Air (model: A3518), while China Broadcasting Network does not [3] - Not all physical stores support eSIM services; only designated stores of China Unicom can process eSIM applications [3] - China Unicom previously announced a door-to-door eSIM service in Shenzhen, but the status of this service is currently unclear [3] Requirements for eSIM - The requirements for obtaining an eSIM are similar to those for traditional SIM cards, with a limit of 5 active cards per carrier and a total of 10 across all carriers in mainland China [4] - There are no restrictions on the type of plans available for eSIM services, allowing both new applications and transfers from existing cards [5] Application Process - The application process for eSIM is reported to be convenient, taking approximately 10 minutes for activation at a physical store [6] - eSIM services are available for both local and some cross-province applications, but there are limitations on cross-city and cross-province services depending on the carrier [8][9] Eligibility for Foreign Residents - Residents from Hong Kong, Macau, and Taiwan can apply for eSIM services using specific travel documents, but cannot do so from different locations [11] - Foreigners can also apply for eSIM services using their passports or permanent residency documents, but China Telecom does not support this group [12] eSIM Management - Users can manage their eSIMs directly through their device settings, including deleting and switching eSIMs [15][16] - Deleting an eSIM does not cancel the number; users must visit a physical store to transfer or reactivate the eSIM [18] Conclusion - The launch of the iPhone Air signifies the beginning of the eSIM era in mainland China, with expectations for further development and improvements in eSIM services from various brands and products [19]

Group 1: Spin-off Announcement - China Unicom announced plans to spin off its subsidiary, Unicom Smart Network Technology Co., Ltd. (Smart Network Technology), for an independent listing on the Shenzhen Stock Exchange's ChiNext board [1][3] - The spin-off aims to enhance the long-term development of Smart Network Technology, allowing it to expand its financing channels and improve its operational capabilities [3][8] - Smart Network Technology, established in August 2015, focuses on automotive digital operation services and has three main business segments: vehicle networking connection, operation, and innovative applications [3][5] Group 2: Shareholding Structure - China Unicom holds 68.88% of Smart Network Technology, with other significant shareholders including FAW Equity Investment (Tianjin) Co., Ltd. and Dongfeng Asset Management Co., Ltd. [6][7] - The shareholding structure indicates a diverse group of investors, primarily from the automotive sector, which is relatively uncommon in the telecommunications industry [6][5] Group 3: Financial Performance - For the first three quarters of 2025, China Unicom reported revenues of approximately RMB 293 billion, a year-on-year increase of 1.0%, with service revenue accounting for over 90% of total revenue [10][11] - The company achieved a pre-tax profit of RMB 24.7 billion, with net profit attributable to shareholders reaching RMB 20 billion, reflecting a 5.1% increase year-on-year [10][11] - The report highlighted a significant reduction in depreciation and amortization expenses, which decreased from RMB 632 billion to RMB 605 billion [11] Group 4: Cloud and Data Center Growth - China Unicom's cloud revenue reached RMB 52.9 billion, marking a significant milestone in its growth trajectory [11][14] - The data center segment generated RMB 21.4 billion, showing an 8.9% year-on-year increase, indicating strong demand for cloud and data services [14] - The company is focusing on integrating 5G, AI, and industrial internet technologies to enhance its service capabilities and drive digital transformation across various industries [14] Group 5: Future Outlook and Investments - China Unicom plans to increase its investment in key technologies such as next-generation internet, artificial intelligence, and network security, with R&D expenses rising by 5.9% [14] - The company is also upgrading its mobile network from 5G to 5G-A and broadband from gigabit to ten-gigabit, aiming to improve user experience and prepare for future digital applications [14]

Core Viewpoint - China Unicom plans to spin off its subsidiary, Unicom Smart Network Technology Co., Ltd., for listing on the Shenzhen Stock Exchange's Growth Enterprise Market, aiming to leverage capital markets for growth in the vehicle networking industry [1] Group 1: Company Overview - Unicom Smart Network Technology was established in August 2015 with a registered capital of 247 million yuan, focusing on vehicle networking and related technology services [1] - China Unicom indirectly holds 69.21% of Unicom Smart Network Technology, with other significant shareholders including FAW Equity Investment (11.02%), Guangzhou Yingyue Venture Capital (3.98%), and Dongfeng Asset Management (3.31%) [1] Group 2: Financial Performance - Unicom Smart Network Technology reported revenues of 437 million yuan, 574 million yuan, and 809 million yuan for the years 2020, 2021, and 2022, respectively, with net profits of 75 million yuan, 117 million yuan, and 100 million yuan [2] - In the third quarter of 2025, China Unicom achieved revenues of 92.783 billion yuan, maintaining year-on-year stability, and a net profit of 2.423 billion yuan, reflecting a 5.4% increase [2] - For the first three quarters of 2025, China Unicom's total revenue reached 292.985 billion yuan, a 1.0% year-on-year growth, with a net profit of 8.772 billion yuan, up 5.2% [2] Group 3: User Growth and New Revenue Streams - As of the third quarter of 2025, China Unicom's mobile user base reached 356 million, with a net increase of 12.48 million users, while fixed broadband users totaled 129 million, with a net increase of 6.79 million [2] - The number of IoT connections surpassed 700 million, indicating significant growth in this segment [2] - The third quarter report disclosed cloud revenue of 52.9 billion yuan, with data center revenue at 21.4 billion yuan, an 8.9% year-on-year increase [2]

Core Viewpoint - China Unicom plans to spin off its subsidiary, Unicom Smart Network Technology Co., Ltd. (Smart Network Technology), for an independent listing on the Shenzhen Stock Exchange's Growth Enterprise Market, pending approval from its controlling shareholder [1][2]. Group 1: Spin-off Details - The spin-off is expected to enhance the long-term development of Smart Network Technology, allowing it to achieve independent listing and diversify its financing channels, which will support its high-quality growth [2][6]. - Smart Network Technology, established in August 2015, is a wholly-owned subsidiary of China Unicom Group, focusing on digital operation services for the automotive sector, with three main business segments: vehicle networking connection, operation, and innovative applications [2][4]. Group 2: Shareholder Structure - China Unicom holds 68.88% of Smart Network Technology, with other notable shareholders including major automotive companies such as FAW and Dongfeng, indicating a strong automotive industry presence within the company [5][6]. Group 3: Financial Performance - For the first three quarters of 2025, China Unicom reported a revenue of approximately RMB 293 billion, a year-on-year increase of 1.0%, with service revenue accounting for over 90% of total revenue [10][11]. - The company achieved a pre-tax profit of approximately RMB 24.7 billion, with net profit attributable to shareholders reaching about RMB 20 billion, reflecting a year-on-year increase of 5.1% [10][11]. Group 4: Cloud Revenue and Growth - China Unicom's cloud revenue reached RMB 52.9 billion, marking a significant growth point for the company, alongside a notable increase in data center revenue by 8.9% to RMB 21.4 billion [11][14]. - The company is focusing on integrating 5G, AI, and industrial internet technologies to enhance its service capabilities and drive high-quality development [14].

Group 1: Technology Developments - JD.com launched a new car auction that attracted nearly 300,000 participants, with the highest bid exceeding 78 million [2] - Over 800 tech leaders, including Steve Wozniak and Richard Branson, signed a public statement calling for a halt to the development of superintelligent AI, warning of risks ranging from economic collapse to human extinction [4] - Huawei officially released HarmonyOS 6, with over 23 million devices now running HarmonyOS, and the new system features significant performance improvements and enhanced security [5] Group 2: Corporate Actions - SpaceX identified and disabled over 2,500 Starlink devices near a suspected scam center in Myanmar [6] - Mercedes-Benz is implementing its largest-ever layoff plan, targeting 30,000 employees, with around 4,000 already accepting severance packages [6] - Apple is set to launch its first foldable iPad, with a projected price close to $3,000, although its release has been delayed to 2029 due to engineering challenges [7] Group 3: Financial Performance - Tesla reported third-quarter revenue of $28.1 billion, a 12% year-over-year increase, but net profit decreased by 37% to $1.37 billion [9] - China Unicom's revenue for the first three quarters reached 292.985 billion yuan, a 1% increase, with net profit growing by 5.2% to 8.772 billion yuan [10] - Qianfang Technology announced a 1,099% increase in net profit for the first three quarters, reaching 189 million yuan [11][12] - Dazhu Laser reported a third-quarter net profit of 375 million yuan, an 86.51% year-over-year increase, with total revenue for the year-to-date at 12.713 billion yuan [13] Group 4: Investment Activities - LiblibAI completed a $130 million Series B funding round, marking the largest financing in China's AI application sector this year [14] - Uniphore raised $260 million in Series F funding, with participation from major investors including NVIDIA and AMD [15] - Uber and Nebius invested a total of $375 million in autonomous driving technology developer Avride, which plans to launch a self-driving taxi service in Dallas by the end of 2025 [16] Group 5: New Product Launches - LoMo announced a partnership with PostBus to launch an autonomous driving service called AmiGo in Switzerland, with plans for full operation by early 2027 [17] - Nubia released its flagship smartphone Z80 Ultra, featuring a gaming engine and advanced photography capabilities, starting at a price of 4,999 yuan [18]

Group 1: Major Developments in Technology and Automotive Sectors - JD.com launched a new car auction that attracted nearly 300,000 participants, with the highest bid exceeding 78 million [2] - Over 800 prominent figures, including Steve Wozniak and Richard Branson, signed a statement urging a halt to the development of superintelligent AI, warning of risks ranging from economic collapse to human extinction [4] - Huawei officially released HarmonyOS 6, with over 23 million devices now equipped with HarmonyOS 5, and the new system features significant performance improvements and enhanced security [5] Group 2: Financial Performance of Companies - Tesla reported third-quarter revenue of $28.1 billion, a year-on-year increase of 12%, but net profit decreased by 37% to $1.37 billion [9] - China Unicom announced a 5.2% year-on-year increase in net profit for the first three quarters, with total revenue reaching approximately 292.99 billion [10] - Qianfang Technology reported a staggering 1,099% increase in net profit for the first three quarters, with revenue of 5.26 billion, a slight decline of 2.82% [11] - Dazhong Laser's third-quarter net profit rose by 86.51% to 375 million, while total revenue for the year-to-date increased by 25.51% [12] Group 3: Investment and Financing Activities - LiblibAI completed a $130 million Series B funding round, marking the largest financing in China's AI application sector this year [13] - Uniphore, a U.S. AI company, secured $260 million in Series F funding, with participation from major investors like NVIDIA and AMD [15] - Uber and Nebius invested a total of $375 million in autonomous driving technology developer Avride, which plans to launch a self-driving taxi service in Dallas by the end of 2025 [16] Group 4: New Product Launches and Innovations - Rabo Run announced a partnership with PostBus to launch an autonomous driving service called AmiGo in Switzerland, aiming for full operation by early 2027 [17] - Nubia Z80 Ultra was launched with a gaming engine and advanced imaging capabilities, priced starting at 4,999 yuan [18]

Investment Rating - The report maintains an "Accumulate" rating for A-shares and a "Buy" rating for H-shares with target prices of RMB 7.56 and HKD 15.57 respectively [6][12]. Core Views - The company has shown improvement in operational efficiency and is accelerating its digital transformation, benefiting from the growth in AI applications which enhance revenue from cloud computing and data center services [1][5]. - Traditional business segments remain stable with a positive growth trend, as evidenced by the increase in mobile users to 356 million and broadband users to 129 million [2]. - The company is enhancing its network capabilities, with cloud revenue growing by 20.6% year-on-year and data center revenue increasing by 8.9% [3][4]. Summary by Sections Financial Performance - For the first three quarters of 2025, the company reported revenue of RMB 292.99 billion, a year-on-year increase of 0.99%, and a net profit attributable to shareholders of RMB 8.772 billion, up 5.20% [1][11]. - The third quarter alone saw revenue of RMB 92.78 billion, with a net profit of RMB 2.423 billion, reflecting a 5.4% increase year-on-year [1]. User Growth - As of the end of Q3 2025, the company had 356 million mobile users, a net increase of 12.48 million, and 129 million broadband users, with a net increase of 6.79 million [2]. Network and Technology Development - The company is advancing its network from 5G to 5G-A and upgrading broadband from gigabit to 10-gigabit, which is expected to enhance user experience [3]. - The cloud business achieved revenue of RMB 52.9 billion, while the data center business generated RMB 21.4 billion, both showing strong growth [3]. Profitability and Efficiency - The company's return on equity (ROE) improved by 0.09 percentage points to 5.10%, and the net profit margin increased by 0.26 percentage points to 6.8% due to enhanced operational efficiency and cost control [4]. - The company plans to spin off its subsidiary, Unicom Smart Technology, for listing on the ChiNext board, which is expected to support its long-term growth strategy [4]. Future Outlook - The report anticipates continued growth in revenue and profit driven by the development of AI applications, maintaining profit forecasts for 2025-2027 at RMB 9.602 billion, RMB 10.124 billion, and RMB 10.643 billion respectively [5][10].

Core Insights - China Unicom reported a net profit of 20 billion RMB for the first three quarters of 2025, reflecting a significant year-on-year increase of 5.1% [1][2] - The company's operating revenue reached 293 billion RMB, showing a modest growth of 1.0% year-on-year, with service revenue accounting for over 90% of total revenue [1][2] Financial Performance - Net profit attributable to equity holders increased to 20 billion RMB, with a pre-tax profit rising to 24.7 billion RMB, indicating enhanced profitability [1] - Service revenue grew to 261.6 billion RMB, marking a 1.1% increase year-on-year [1] User Growth - The total number of mobile users reached 356 million, with a net addition of 12.48 million users [1] - Fixed broadband users increased to 129 million, with a net addition of 6.79 million users, achieving the highest net growth in recent years [1] - The number of IoT connections surpassed 700 million [1] Business Structure and Growth Areas - The cloud and data center business segments emerged as key growth drivers, with cloud revenue reaching 52.9 billion RMB and data center revenue increasing by 8.9% to 21.4 billion RMB [2] - The company is focusing on deepening the integration of 5G, AI, and industrial internet, serving over 20,000 customers with 5G virtual private networks [2]

Core Insights - China Unicom reported a revenue of 293 billion yuan for the first three quarters of 2025, a year-on-year increase of 1.0%, and a net profit of 8.8 billion yuan, up 5.2% year-on-year [1] - The company is focusing on integrated innovation and expanding new productive forces, maintaining a positive momentum in operational development [1] - All three major telecom operators in China, including China Mobile and China Telecom, have shown steady growth in revenue and net profit [1] Group 1: Business Growth - China Unicom's mobile user base reached 356 million, with a net increase of 12.48 million users, while fixed broadband users reached 129 million, with a net increase of 6.79 million users [2] - The number of IoT connections surpassed 700 million, indicating a significant expansion in connectivity [2] - The company's cloud revenue reached 52.9 billion yuan, and data center revenue was 21.4 billion yuan, reflecting an 8.9% year-on-year increase [2] Group 2: Technological Advancements - China Unicom is enhancing its capabilities in next-generation internet, big data, AI, and cybersecurity, with a focus on 6G, low-altitude smart networks, and quantum technology [3] - R&D expenses increased by 5.9% year-on-year, leading to more significant achievements in technology [3] - The company is integrating 5G, AI, and industrial internet to empower various industries, with over 20,000 customers served by its 5G virtual private network [2] Group 3: Strategic Initiatives - China Unicom plans to spin off its subsidiary, Unicom Smart Network Technology Co., Ltd., for listing on the Shenzhen Stock Exchange's Growth Enterprise Market [4] - This spin-off aims to enhance the innovation and operational quality of Smart Network Technology, allowing it to leverage capital markets for growth in the vehicle networking sector [4] - The spin-off is part of China Unicom's broader strategy to optimize its industrial layout and strengthen core competitiveness [4] Group 4: Financial Performance of Subsidiary - Unicom Smart Network Technology reported revenues of 437 million yuan, 574 million yuan, and 809 million yuan for the years 2020, 2021, and 2022, respectively, with net profits of 75 million yuan, 117 million yuan, and 100 million yuan [5] - The company focuses on vehicle networking and smart transportation, aligning with national strategies for building a strong transportation and digital economy [6]